Indian Railway Case Study

In 21^st Century Indian Railways Ministry addresses huge demand of Passenger travel by increasing number of trains at different time intervals. But there is a political dimension to this; most of the new trains added are on routes where key politicians want to show their seal of governance.

Objective: Increase supply of passenger seats to met surplus demand.

Present Capacity of a Train

Compartment Type	No. of Coaches	Max intake	Passenger Cap
Second Class (General Compartment)	3	72	216
Sleeper Class (SL)	12	72	864
AC 3-Tier Sleeper (3A)	2	64	128
AC 2-Tier sleeper (2A)	1	48	48
First Class	1	18	18
Tatkal Scheme	2	72	144
Total Passenger Capacity	21		1418

I am assuming that you are aware of the existing processes to book a ticket / know the availability / or cancellation. Let us now look at a hypothetical scenario. A user logs into the www.indianrailway.gov.in and checks availability for a train from Mumbai-Goa on 1^st April; its 3 days before the date of Journey. He is unable to get air tickets too.

The System informs him-Latest Waiting List 250, the system also informs him that he can book the ticket and seat will be confirmed if Waiting list touches 400+ as per the “Special Dynamic Booking”

System informs him, that if wants to avail the “Special Dynamic Booking” he will have to pay a premium of 30% or X% more than normal fare (X% refers to a percentage premium computed by CRM application)

What is Special Dynamic Booking?

Assume Sleeper Class Present carrying capacity of train is 864, let’s take this as X. and Y as passenger capacity that can be added to train dynamically. Now Y can be added only when Railway authorities feel it’s either a profitable deal or a breakeven deal for them, depending on their objective.

This is an alternate solution to increasing number of trains, which puts more pressure on the Railway traffic logistics & updating all databases with creation of new train number. Instead dynamic addition of coaches along with a special additional engine can be added to present train. This can be achieved with integrated application of CRM & SCM.

As soon the system identifies a Waiting List to be a number which is profitable; it will integrate the Supply Chain to add more coaches with a special engine.

What’s the difference between Tatkal and “Dynamic Adding?”

Tatkal scheme allows appx 2 coaches to be added. Where as Dynamic Adding can maximum double the capacity of a normal train with an attached engine. This exclusivity allows a premium price point.

Arguments in favour:

1. Resources required for new trains & “Dynamic Adding” is same.
2. Increase the Platform length
3. What if Y seats added to present capacity are unsold? Then these tickets can be sold at discount price prior to the journey similar to the revenue model followed in airline industry.
4. Commuters will have to walk more on Platform to move to one end of the Platform, but this is minimal to the frustration of not being able to travel or waiting for another train. For the same, Platforms can be better designed with correct information of where coach is positioned. And Moving walkways can be used to commute with luggage from one side of platform to other. The speed of a moving walkway is usually 3 km/h, but there is a high-speed version at Gare Montparnasse station in Paris at 9km/h.

Acronyms: CRM-Customer Relationship Management

SCM-Supply Chain Management

Reference: http://www.travelindependent.info/india_trains.htm;

http://en.wikipedia.org/wiki/Railways_in_India

Case Writer- Navendu Shirali